Setting PrioritiesBy Baselinemag | Posted 2003-06-01 Email Print
Cookie-cutter overhauls and a system of 'sister plants' let the $4 billion can-maker digest acquisitions fast.
So Ball set priorities.
"We developed a strategy to first convert their [Walker] general ledger [system] to ours, then their human resources and their shipping systems to our accounts payable [system]," Andrews says.
"We did all that in the first week [in August 1998]," he says. "After that, we could take our time."
They tried bringing in consultants to help with that transition, but after several proposals decided the price was "four times what we wanted to pay, and so we did it on our own," he says. It took 10 months.
In the process, Ball elected to use J.D. Edwards software for centralized accounting; it is using integration software from webMethods to enable communication between systems at Reynolds and at Ball. The aim: Speed up delivery of sales information to management. The plans developed in that complex acquisition have become formats for what they do with smaller companies they have acquired, or with whom they have launched a joint venture.
"It's a cookie-cutter approach to simplify the process," Andrews says. But the hallmark of developing that process, he says, was "flexibility."
To that end, the company has introduced quality control systems that will adapt to different operating characteristics at new plants coming on line. The systems report data from cans produced in each plant, as they proceed down the line. That allows employees to quickly adjust microscopic specificationssuch as the thickness of lacquer used to prevent corrosion on the inside of cans.
Ball also sped up integration by creating "sister plants."
"It's a plan where business management people from one plant with similar operations would help train personnel of the newly acquired plants on procedures and best practices, so we in I.T. didn't have to focus on that," says Andrews. In effect, business managers help technology managers change systems over, by relieving them of educating personnel on new processes.
As more acquisitions and joint ventures come along, Ball's approach to cross-training factory, warehouse and information systems personnel could pay off, almost from the start. For instance, the company can tell from tracking turnover of inventory what the effect on a new plant will be of applying Ball's manufacturing and planning software and controls.
"We do a lot of benchmarking between our operations and look for best practices and then spread them throughout the company. Better, faster, cheaper and high quality are what we are after," Andrews says.
Andrews pointed to Ball's "Quality System" as one example. In this system, plants report monthly on quality, spoilage and operating costs. And individual plants report results from shift to shift. "The plants actually review the Quality System results from the prior shift in their shift turnover meetings, to make them aware of the potential for changes needed on the line," Andrews says. "They are very metrics-driven."
The spreading of best practices now feeds on itself.
"We have projects backlogged" (such as installing new integration software from webMethods), Hoover says. "But we won't do them until we need production, or until we can show they will have a good payback. You might be able to save money; if you can't get your money back at a high rate of time, you don't do it."
The company expects big payback from its internal Web site. "Our goal is to have our use of the portal become the foundation for future interaction between employees and managers," Andrews says. After all, electronic communication is the fastest way to knit together an operation that has spread to 30 locations around the world.
Ball's largest integration challenge to date has come with the acquisition late last year of Germany's Schmalbach-Lubecathe second-largest beverage can maker in Europe.
Andrews says Ball quickly came to realize that Schmalbachnow Ball Europehad acquired more sophisticated technology than Ball itself was using, running a more fully integrated system on the plant level.
But Schmalbach-Lubeca was not using all the capabilities of its investments, such as SAP's business warehousing product, with which they are gathering data on factory systems.
"They were running SAP, and we are running J.D. Edwards at this point, so since the acquisition, we have been doing a lot of looking and learning from each other," says Andrews.
Customers such as Coke and Pepsi are interested in suppliers engaging in "just-in-time" order and supply-chain management that is similar in some ways, Andrews says.
"We need to anticipate that change, and I do expect that there will be change," Andrews says. "We are going to get the Anheuser and the Miller Beer and Coca-Cola people looking at us soonas they have looked at other suppliers."
To prepare for that, the company has been migrating its homegrown technology to J.D. Edwards to make its data gathering as consistent as possible throughout its manufacturing and distribution facilities. That, Andrews suggests, will allow it to adapt more quickly to providing cans on a just-in-time basis to soft-drink makers and brewers.
The emphasis on cans and metal containers has allowed the company to focus on more than just its information and manufacturing systems, Hoover says.
Ball spun off seven of its product lines, including glass jar and rubber products lines, and it negotiated favorable contracts that allowed the company, for instance, to require a joint partner to purchase the glass manufacturing facilities if sales fell below a certain point.
Its roots also changed. It pulled up stakes in 1998 and moved its century-old headquarters from Muncie, Ind., the heartland of home canning, to Broomfield, Colo., near the company's aerospace division.
Five years later, the payoff is becoming clear. "Fortunately for us," says Hoover, "it has all come at a time when people can recognize what we have accomplished."
Now the company's systems communicate better, not just with suppliers but customers. For instance, Ball now can help Coors and ConAgra better coordinate their warehouse capacity. Capabilities like that could help it land more of the big clients it needs to keep ramping up can production worldwide.